Madison Asset Management LLC Makes New $80.89 Million Investment in A. O. Smith Corporation $AOS

Key Points

• Madison Asset Management disclosed a new stake in A. O. Smith, buying 1,209,405 shares worth about $80.9 million in the fourth quarter and ending with 0.87% ownership.
• A. O. Smith recently reported weaker-than-expected quarterly results, with EPS of $0.85 versus estimates of $0.94 and revenue of $945.6 million versus forecasts of $974.1 million.
• Analyst sentiment is mixed but cautious: the stock has a consensus Hold rating and average price target of $70.44, while several firms have recently cut ratings or targets.

Madison Asset Management LLC bought a new stake in shares of A. O. Smith Corporation (NYSE:AOS - Free Report) in the fourth quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The firm bought 1,209,405 shares of the industrial products company's stock, valued at approximately $80,885,000. Madison Asset Management LLC owned 0.87% of A. O. Smith at the end of the most recent reporting period.

Several other hedge funds and other institutional investors also recently added to or reduced their stakes in AOS. Rothschild Investment LLC increased its position in shares of A. O. Smith by 3,125.0% during the third quarter. Rothschild Investment LLC now owns 387 shares of the industrial products company's stock worth $28,000 after acquiring an additional 375 shares during the period. Torren Management LLC acquired a new position in shares of A. O. Smith during the fourth quarter worth $31,000. Eagle Bay Advisors LLC acquired a new position in shares of A. O. Smith during the fourth quarter worth $32,000. Root Financial Partners LLC purchased a new position in A. O. Smith in the third quarter valued at $33,000. Finally, Larson Financial Group LLC raised its stake in A. O. Smith by 67.9% in the third quarter. Larson Financial Group LLC now owns 487 shares of the industrial products company's stock valued at $36,000 after buying an additional 197 shares in the last quarter. Hedge funds and other institutional investors own 76.10% of the company's stock.

Insider Buying and Selling

In related news, SVP Darrell W. Schuh sold 1,104 shares of the company's stock in a transaction on Wednesday, March 4th. The shares were sold at an average price of $74.39, for a total value of $82,126.56. Following the sale, the senior vice president directly owned 2,201 shares of the company's stock, valued at $163,732.39. This represents a 33.40% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Corporate insiders own 0.50% of the company's stock.

Analysts Set New Price Targets

A number of analysts have weighed in on the stock. Oppenheimer reissued an "outperform" rating and set a $80.00 price objective on shares of A. O. Smith in a report on Friday, May 1st. Zacks Research downgraded A. O. Smith from a "hold" rating to a "strong sell" rating in a research note on Wednesday, May 6th. Citigroup reduced their price objective on shares of A. O. Smith from $74.00 to $65.00 and set a "neutral" rating for the company in a research note on Monday, May 4th. The Goldman Sachs Group decreased their target price on A. O. Smith from $69.00 to $61.00 and set a "sell" rating on the stock in a research report on Monday, April 13th. Finally, Wall Street Zen lowered shares of A. O. Smith from a "buy" rating to a "hold" rating in a research report on Saturday, February 14th. Two equities research analysts have rated the stock with a Buy rating, seven have assigned a Hold rating and two have assigned a Sell rating to the stock. According to data from MarketBeat, the company presently has an average rating of "Hold" and a consensus target price of $70.44.

A. O. Smith Stock Performance

A. O. Smith stock opened at $58.08 on Wednesday. The firm has a market capitalization of $8.01 billion, a P/E ratio of 15.45, a PEG ratio of 1.29 and a beta of 1.23. The stock has a fifty day moving average price of $65.52 and a 200 day moving average price of $68.53. A. O. Smith Corporation has a 52 week low of $57.49 and a 52 week high of $81.86. The company has a current ratio of 1.56, a quick ratio of 1.00 and a debt-to-equity ratio of 0.31.

A. O. Smith (NYSE:AOS - Get Free Report) last released its quarterly earnings data on Thursday, April 30th. The industrial products company reported $0.85 EPS for the quarter, missing analysts' consensus estimates of $0.94 by ($0.09). The firm had revenue of $945.60 million for the quarter, compared to analyst estimates of $974.06 million. A. O. Smith had a return on equity of 28.42% and a net margin of 13.84%.The company's quarterly revenue was down 1.9% on a year-over-year basis. During the same quarter in the previous year, the company earned $0.95 earnings per share. A. O. Smith has set its FY 2026 guidance at 3.600-3.900 EPS. Equities research analysts anticipate that A. O. Smith Corporation will post 3.78 earnings per share for the current year.

A. O. Smith Announces Dividend

The business also recently announced a quarterly dividend, which will be paid on Friday, May 15th. Stockholders of record on Thursday, April 30th will be given a $0.36 dividend. The ex-dividend date of this dividend is Thursday, April 30th. This represents a $1.44 annualized dividend and a dividend yield of 2.5%. A. O. Smith's dividend payout ratio is presently 38.30%.

About A. O. Smith

A. O. Smith Corporation, based in Milwaukee, Wisconsin, is a leading manufacturer of water heating and water treatment products for residential and commercial applications. Since its founding in 1874, the company has built a reputation for producing reliable, energy-efficient water heaters, boilers and pressure vessels. Its product portfolio encompasses gas, electric, condensing and tankless water heaters, as well as specialty boilers designed to meet a variety of building and industrial needs.

The company operates through two primary segments: North America and Asia.

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